Inflation and individuals
No American has to read the White House's annual report on the economy to know that inflation is high. The danger lies in accepting high inflation as a way of life. The warning appears in such headlines as the one saying that the report "underscores fears inflation will become embedded." To resist and eliminate such fears requires not only governmental but individual attitudes and actions that firmly address the problem.
Mr. Carter deserves credit for not prettifying the prospects in an election year, though some may argue that by stressing a bleak picture far into the future he is trying to get himself off the hook. Also, while predicting some recession, he rejects the politically inviting remedy of an election-year tax cut, though some may argue he could well offer a tax cut if he got the federal budget under control.
Indeed, he can hardly expect the public to believe he thinks inflation is so bad if he will not take firmer measures to balance the budget and influence wages and prices. When he winds up his gloomy message by calling for "patience, " the question is not just how long the public will be patient with bad conditions -- but with him.
However, Mr. Carter can hardly be gain- said when he also calls for "self-discipline, combined with some ingenuity and care." These are attitudes to be cultivated not only by the government but by the people. The President ought to give them more ringing expression as the year goes on. Perhaps, with Canada so much in the news for its rescue of American citizens, another form of rescue could be found in what Canada's former Prime Minister Trudeau once said about finding an equivalent to influential economist Maynard Keynes for an inflationary age. He said it might not be an economist at all but "a political, philosophical or moral leader inspiring people to do without the excess consumption so prominent in the developed countries."
Here is a chance for Mr. Carter to take the kind of moral lead on which he campaigned four years ago. If inflation is not to become "embedded" -- and accepted as such -- the Keynsian techniques of spurring economic demand have to be followed with no less vigorous techniques of cutting demand.
This is part of the reasoning in the latest paper from the Worldwatch Institute research organization. Dealing with inflation on a global scale, it is no more encouraging than the White House report if actions are not pursued and attitudes changed. For long-range solutions it has to be seen that the old methods of increasing supplies to meet demands run into such problem as dwindling of certain resources while populations increase.
The new approach should not mean more deprivation for those already deprived. It should mean some self-discipline, ingenuity, and care by everyone to see whether what they want is what they need. It should mean simpler living, more enjoyments that don't have price tags. It should mean institutions helping rather than hindering individuals in this direction. To take but one example, suppose more advertising followed the trend not of manufacturing wants but of meeting needs efficiently, telling how to live well without waste.
Economic reports come and go. Economists disagree. Each one of us, however, can look at his or her own balance sheet -- and improve it.